Univision Lays Out Reasons for Dismissal of Donald Trump's $500 Million Lawsuit

AP Photo/Rich Schultz

Donald Trump

Univision attorney Miguel Estrada says that Trump's infamous remark that Mexicans are "rapists" made it impossible for Univision to carry forward with the Miss USA broadcast.

It's not every day that Donald Trump's hairstyle gets mentioned repeatedly in a court of law. On Tuesday, however, his famous blond hairdo was one of the reasons Univision gave for why the lawsuit filed by the Republican presidential candidate should be thrown out.

Trump and his former Miss Universe organization filed suit this past June after Univision backed away from a five year, $13.5 million deal to broadcast the Miss USA pageant. Since then, the lawsuit has faded from headlines. Trump sold Miss Universe to William Morris Endeavor and in a tweet, implied he had settled his lawsuits. But the settlement was with NBCUniversal. A status conference hearing, a necessary precursor to a motion to dismiss, was postponed several times thanks to unavailable lawyers, the Jewish holidays and an imminent hurricane, but Univision finally got a chance to give the reasons why it believes the lawsuit fails as a matter of law.

First, though, plaintiffs definitely intend to move forward.

"We understand how [Univision] made a business judgment, but actions have consequences, " said an attorney for Miss Universe and Trump.

Miguel Estrada, attorney for Univision, responded that the judge should reject claims of breach of contract, breach of the implied covenant of good faith and fair dealing, and defamation.

To the breach claim, Estrada said that Trump's infamous remark at his presidential announcement that Mexicans are "rapists" made it impossible for Univision to carry forward with the Miss USA broadcast. Technically speaking, the defense being asserted is frustration of purpose. Estrada acknowledged that it was rare for a judge to dismiss at the pleading stage on these grounds, but he said this was an "unusual case," that what Trump said about Mexicans "ruined the value of the contract" for Univision and that given the publicity, the judge should take it into consideration when later determining whether to dismiss the claim.

U.S. District Judge John Koelt seemed skeptical of this argument, and Trump's lawyer responded that foreseeability is an element that rebuts frustration of purpose, and that Univision was well aware of Trump's colorful character yet included no morals clause in the deal.

The straight contract claim has a reasonable shot of surviving a motion to dismiss, but the judge was equally skeptical about the viability of Trump's other claims. Estrada attacked the breach of good faith claim as duplicative of the contract one and said there was too much ambiguity on how it was that Univision supposedly interfered with Trump's relationship with NBC to support an allegation of tortious interference. Univision's lawyer mentioned other companies like Macy's, ESPN and NASCAR backing away from Trump after his infamous comments and said that anybody has the right to push companies to disassociate from controversy.

Attorneys from the plaintiffs responded that it was "suspicious" how NBCU moved backward from their joint venture with Trump just days after Univision canceled the Miss USA broadcast. The judge mused whether mere suspicion would be enough to send the case toward a stage where the plaintiffs would seek more evidence of communications between Univision and NBCU.

As for defamation, Trump alleges his reputation was tarnished after Univision Networks president of programming and content Alberto Ciurana posted on Instagram a side-by-side portrait of him and South Carolina shooter Charleston, S.C., shooter Dylann Roof. At the hearing, Trump's lawyers said readers of that Instagram posting could get the impression that Trump was being called a "murderer."

Univision ridiculed that assessment, saying there was no statement of fact that could rise to defamatory meaning. Estrada also said that observers could take it as a "parody of his hairstyle or political views." Later, after both the judge and opposing counsel remarked about the comment about Trump's hair, Estrada emphasized that parody of hairstyle was just one of the ways the defamation claim would be barred by the First Amendment to the U.S Constitution.

Interestingly, Estrada also challenged whether the plaintiffs really had authority to pursue the lawsuit in light of Trump's Miss Universe sale to WME. Attorneys for plaintiffs said they did in fact have authority and would spell it out in an amended complaint, which is scheduled to come in the next couple of weeks. For now, it appears as though WME has signed off on going ahead with the lawsuit against Univision, which could mark an important development.

But plaintiffs did back down in one respect. The original lawsuit includes a separate claim for punitive damages. This was the basis of a $500 million damages demand that got plenty of press play. But there's no real cause of action for punitive damages and when the new complaint comes, it will be stripped, according to plaintiffs lawyers. If the case gets to trial, only a judge and jury will decide whether Trump and Miss Universe deserve more than the $13.5 million they were due to get from the deal with Univision.